In this blog series we will see how sale return works, what is importance or disposition code from finance and inventory.
For each disposition code that you define, you must select a disposition action. The disposition action determines the physical and financial implications of the disposition codes. For example, the disposition action determines the physical handling of the returned item, the financial effect of the returned item, and if a replacement item must be sent to the customer. You can define an unlimited number of disposition codes according to your business needs, but there are only six predefined disposition actions that you can select from. The following table provides the disposition actions and their definitions.
|Return the item to inventory and credit the customer.
|Credit the customer without requiring or expecting the item to be returned.
|Scrap the item and credit the customer.
|Replace and credit
|Return the item to inventory, create a replacement order, and credit the customer.
|Replace and scrap
|Scrap the item, create a replacement order, and credit the customer.
|Return to customer
|Reject the returned item and return it to the customer.
Now in this blog series, we will see example of each Action type. This blog we will see two Actions (Credit only and Credit)
- Credit only:
Credit the customer without requiring or expecting the item to be returned. This we can have a business scenario where for company getting the item back to inventory might cost more than product cost or may be product type like food etc…
Lets understand from example:
Create: Sales order
Create Return order
Select disposition code “Credit only” action
Process return order
Post credit note
Return the item to inventory and credit the customer. This can be where products can be returned back to inventory e.g. Ecommerce Laptop, Hardware etc…
Lets understand this by example
Create return order against sales order
Since we are expecting inventory ack , so we need to register the inventory line which will pop up for disposition code
Post packing slip
Post credit invoice
Analys Inventory and voucher
That’s it for this blog, Hope this will help in understanding different disposition code for sales return
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